To Comply With Anti-Bribery Law, Banks Must Be Careful with Payments for Licenses, Sovereign Clients

By Brian Monroe

As prosecutors continue to accuse companies and individuals of foreign bribery, banks should be cautious about how they acquire licenses and sovereign wealth accounts, and where their clients send money abroad, say consultants. Enacted in 1977 but little used until 2006, the Foreign Corrupt Practices Act (FCPA) prohibits companies from bribing foreign officials to win contracts or other lucrative business relationships. The law has been cited by U.S. banking regulators who have exhorted banks to monitor for suspicious transactions potentially tied to bribes and foreign corruption. Identifying such bribes can be challenging for banks, particularly when the payments are wired...